Economy Current Affairs - Current Affairs Today


CBDT sets up panel to recommend steps to reduce litigation

In an unprecedented move, the Central Board of Direct Taxes (CBDT)set up a six-member panel to examine the “efficacy” of the existing primary litigation mechanism in the Income Tax (IT) Department. The step has been taken in the wake of an estimated Rs 4 lakh crore of tax revenue locked up in litigation. The empowered committee, under the chairmanship of senior IRS officer and Chief Commissioner of Income Tax office in Ahmedabad Rani S Nair, has also been mandated to suggest steps to reduce legal cases at the IT department’s two dispute resolution forums and asked to submit its report within 8 weeks.

The panel has been constituted with an objective to evaluate the efficacy of existing dispute resolution forums of Commissioners of I-T (Appeals) and Income Tax Appellate Tribunal (ITAT) and to recommend steps to reduce litigation before these forums.

Currently, there is a four-stage grievance redressal and litigation mechanism available to a taxpayer. It starts with an appeal to the Commissioner of I-T Appeals called CIT (A), further up to the ITAT and subsequently to the High Court and the Supreme Court.

CBDT, the topmost policy making body of the I-T department, has also assigned the new committee with the task of undertaking a fresh initiative and categorize and examine select assessment orders issued by I-T officers across the country under various income groups (returned income).

The categories defined by CBDT include income under Rs 25 lakh, income between Rs 25 lakh-Rs 1 crore, between Rs 1 crore-Rs 10 crore and above Rs 10 crore.

Business 20 (B20) Australia Summit opens in Sydney

The business leaders of G20 countries held a meeting named Business 20 (B20) Australia Summit in Sydney. They issued a blueprint for G20 leaders to boost economic and job growth and make global economy more resilient to deal with any future impacts. The summit was chaired by Richard Goyder, Managing Director and CEO of Wesfarmers.

The Business 20 (B20) is a forum through which the private sector brings forth policy recommendations for the annual summit of the G20 leaders. The forum is the concourse of business leaders from across G20 member nations to reflect the ​key role of the private sector as the main driver of strong, sustainable and balanced growth.

As President of the G20 in 2014, Australia has established a B20. The B20 Australia Leadership Group includes 30 Australian business leaders representing a range of industries. It is chaired by Richard Goyder AO, Managing Director and CEO of Wesfarmers. B20 Australia will lead business engagement and coordinate the communication of international business priorities to the G20 during Australia’s presidency.​

B20 Summits typically involve more than 400 participants from across the G20 member countries.

Chairperson: Richard Goyder AO Managing Director and CEO, Wesfarmers is the current Chairman, B20 Australia​​

Delhi Budget 2014: Highlights

Union Finance Minister Arun Jaitley presented Rs.36,776 crore budget for Delhi in Parliament as the state is currently under the President’s rule.

The Budget proposed no new taxes for Delhi and announced a subsidy of Rs.0.80 to Rs.1.20 per unit to small power consumers as also a number of welfare measures like low floor buses, sanitation and multi-speciality hospital in Rohini.

Here are the highlights from the Budget for Delhi 2014-15:

  • Rs.260 crore set aside for power subsidy in Delhi
  • Small electricity consumers to get power subsidy between Rs.0.80-1.20 per unit, 80 paise subsidy up to 400 unit, Rs.2.80 for 0-200 unit electricity consumption, Rs.5.15 for 201-400 units
  • Rohini will have a multi-speciality hospital
  • 50 dialysis centres will be opened across Delhi
  • No new taxes or increase in the present tax rates
  • More night centres
  • Four new sewage treatment plants
  • Community toilets to be set up in JJ clusters
  • 1,380 new low floor buses
  • Expansion of pension scheme from 3.90 lakh people to 4.30 lakh people
  • 20 new schools, government girl schools
  • 110 new ambulances to tackle increasing number of trauma cases in Delhi
  • Rs. 2, 482 crore allocated for education, Rs. 1,700 crore , Rs. 3,702 crore

Power sector:

  • Plan outlay of Rs.675 crore for energy sector.
  • Transmission and distribution network will be improved.
  • Delhi Transco Ltd to commission a new 400 kv substation at Harsh Vihar and 220 kv gas insulated switch gear substation at Peeragarhi.
  • Three new 220 kv GIS substation at Papankalan, Tughlaqabad  and Rajghat power house to come up.
  • Provide adequate gas supply at reasonable cost to 1500 MW gas turbine station commissioned at Bawana
  • NDMC area to be developed as a solar city.
  • Rs. 260 crore set aside for providing power subsidy for domestic consumers to provide relief to targeted consumers on account of recent tariff hike by DERC.
  • Rs.200 crore allocated for power reforms and Rs.500 crores for water reforms in NCT.

Transport sector:

  • Plan outlay of Rs.3,702 crores for transport sector
  • 1380 new semi, low floor, buses for DTC will be procured
  • Introduction of an automated fare collection system through electronic ticketing machines and card readers by DTC
  • 400 new cluster buses, making a fleet of about 1600 cluster buses.
  • Modernization and renovation of regional offices of transport department
  • New ISBT at ISBT Sarai Kale Khan and Anand Vihar will be developed as they currently lack adequate infrastructure.
  • Work on Phase II of elevated corridor over Barapullah Nallah at cost of Rs.533 crore is ongoing. This will be extended from Sarai Kale Khan to Mayur Vihar under Phase III.

Water Supply:

  • Pucca parallel channel from Munak to Haiderpur will be made functional after resolving issues with Haryana. This will supply 80 million gallons per day raw water for newly built water treatment plants – at Dwarka, Okhla, Bawana for a population of about 35 lakh living in south, south west, west and north west delhi.
  • To begin with the construction of long pending Renuka dam with an initial capital of Rs.50 crore.
  • Chandrawal water treatment plant and Wazirabad plant will be completely renovated at a cost of Rs.2018 crore and Rs.2243 crore respectively.

RBI issues draft guidelines for setting up small banks, payment banks

The Reserve Bank of India (RBI) issued draft guidelines for setting up of small banks, which will have a local feel and will provide small-ticket loans to farmers and businesses.
The apex bank also issued draft norms for establishing payment banks, which will provide services to marginalized sections of society, including migrant labourers, for collecting deposits and remitting funds.

The step from the apex bank comes close on the heels of Finance Minister Arun Jaitley announcement in his Budget speech 2014-15 that RBI would create a framework for licensing small banks and other differentiated banks. Differentiated banks like local area banks and payment banks have been considered to meet credit and remittance needs of small businesses, unorganized sector, low income households, farmers and migrant work force.
As per RBI guidelines:

  • The minimum capital requirement for such banks will be Rs 100 crore as against Rs 500 crore required for normal commercial banks.
  • Small Banks will provide a whole range of basic banking services such as deposits and supply of credit, but their area of operation will be limited. 
  • Payments Banks will provide very basic and limited number of products such as acceptance of demand deposits and remittances of funds.
  • Payments banks will have an extensive network of access points mainly in remote areas, either through their own branch network or through Business Correspondents (BCs) or through networks provided by others.
  • Foreign investments in these new category banks would be as per the FDI policy. 
  • RBI has allowed existing non-bank pre-payment instrument issuers, Non-Banking Finance Companies (NBFCs), corporate BCs, mobile telephone companies, super-market chains, firms, real sector cooperatives and public sector entities to apply for the license to set up payments bank.
  • To set up small banks, resident individuals with 10 years of experience in banking and finance, companies and Societies will be eligible as promoters.
  • Existing NBFCs, Micro Finance Institutions (MFIs), and Local Area Banks (LABs) can also choose for conversion into small banks.

Local focus and the ability to serve smaller customers will be a key criterion in licensing the new category of banks.